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1) That isn't real GDP growth so the equation actually gets much worse
2) The government spending level pre-Trump was not sustainable. Add on Trump's budget deficits (Pre-covid), the cost of the pandemic, and the entire bat mierda policies of the current woke admin. The $, future interest rates, and US treasury demand are all going to be under serious pressure going forward.
It's almost appendages are rotten with gangrene need to be removed but we don't realize it yet.
When the sky comes crashing all the plebs in Murica that are hooked to entitlements would yell in anger why didn't anybody tell us why didn't anybody do anything. Well we've been saying the warning of excess spending for 20 years now just nobody wanted to listen.
2020 GDP this time last year: $22.7 T
2020 total (public/private) debt this time last year: $81.4 T
Current GDP: $23T
Current total debt: $85.1 T
GDP growth over the past year: $300B
Total debt growth over the past year: $3.7T
3.7 T/300B= $12.33 of debt for every one dollar of GDP added.
This "economy" is an unsustainable trainwreck waiting to happen.
The Q4 2020 total public debt is $27.7 T - total household debt is $14.6 T ($10.4 T mortgages, $1.6 T student loans, $1.4 T auto loans, $1.2 T credit cards, etc) - the rest is primarily in market assets such as bonds - data from the Fed reserve. The private debt vs GDP was coming down until COVID hit and put a large portion of debt payoff on hold.
If compare the debt as percent of GDP, US debt is in line with most industrial countries and far from the highest. Also what is sometimes overlooked is that almost all of the private debt and most of the federal debt is held by US investors, a little less than 30% of federal debt is owned by foreign investors (~$6.2 T) - so as much as 90% of the money servicing debt goes back into the economy as principle and interest payments - that is making money flow where it is needed, financed by those that save and invest - that is far from a "trainwreck".
Suppose the Fed/government printed 5 trillion dollars and put it in a salt dome.
It wouldn't cause inflation or any other change in the economy.
Now compare if they "printed" 5 trillion and distributed it to the top 1%, as opposed to evenly distributing it to every household (about 123 million households)
Giving it to the top 1% would little affect the economy - they already have 35 trillion. We'd see the stock market go up some, and absurd art prices go up.
But distributing that to all the households would be about $41,000 each. This would set off a buying spree and classic price inflation. That is, if everyone still had their jobs. But that didn't happen during the pandemic. Many people lost jobs and used that money for paying bills, food, and rent.
But what happened in recent several years? Did we see trillions go to ordinary folks? Or did some go to the folks while most of it went to the top of the wealth pyramid? That will tell us how much inflation will be set off.
I'm leaning to say we'll see some immediate inflation, but not much. That's because most of the money printed in the last several years went to the top people/institutions and stayed there.
Suppose the Fed/government printed 5 trillion dollars and put it in a salt dome.
It wouldn't cause inflation or any other change in the economy.
Now compare if they "printed" 5 trillion and distributed it to the top 1%, as opposed to evenly distributing it to every household (about 123 million households)
Giving it to the top 1% would little affect the economy - they already have 35 trillion. We'd see the stock market go up some, and absurd art prices go up.
But distributing that to all the households would be about $41,000 each. This would set off a buying spree and classic price inflation. That is, if everyone still had their jobs. But that didn't happen during the pandemic. Many people lost jobs and used that money for paying bills, food, and rent.
But what happened in recent several years? Did we see trillions go to ordinary folks? Or did some go to the folks while most of it went to the top of the wealth pyramid? That will tell us how much inflation will be set off.
I'm leaning to say we'll see some immediate inflation, but not much. That's because most of the money printed in the last several years went to the top people/institutions and stayed there.
It would make the 1% more rich than they already are, and is how the bankers became rich in first place. They can create money after going through some red tape, and formalities.
If distributed to all households, it wont make a difference because no one's position in life has changed relative to one another. The rich will still be the rich. Middle class will still have more money than the lower, and the lowest will still be poorer than everyone else.
Uh-huh. Let's get together and research events of the the years 2020 and 2021 to see if there was anything happening that might have been a world wide threat to the economy.
If we can just figure that out, the maybe those numbers you posted could be placed into some context to explain why such debt was being created. And knowing that, then we can see whether there is or not some reason to think the need that created that debt will go away.
I'm thinking it probably was not the Australian snake infested sea foam threat, but I can't prove it wasn't .
I’ve seen some crazy ideas around here but use research and context? That’s wild…
The people who get it don't need to be told. And the people who need to be told ain't gonna listen at this point. Until something happens to them personally in a drastic way, it won't sink in.
The one that thinks the debt increase just funded the incremental increase in one years gdp to the next? Or the one that thinks the debt increase filled in the multi-trillion gap of lost/eliminated economic activity because of Covid as a form of preventative maintenance and/or applying pressure to support the economy like a weight lift spotter?
The premise of the OP isn’t even something that’s a reasonable claim.
The one that thinks the debt increase just funded the incremental increase in one years gdp to the next? Or the one that thinks the debt increase filled in the multi-trillion gap of lost/eliminated economic activity because of Covid as a form of preventative maintenance and/or applying pressure to support the economy like a weight lift spotter?
The premise of the OP isn’t even something that’s a reasonable claim.
It's not an either/or proposition.
It's both/and.
Policymakers have been pissing in the well for some 30 years now.
As for the past two years, to be sure, do what's necessary to keep the payments system going.
If someone was in a terrible car accident that forced 1.5 years of rehab and at the end of the day they were 5% stronger than they were originally, no one would say all that work and effort went to just achieve a 5% gain.
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